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Unanswered questions on Singapore’s population policy

By Dark Matter

A speech by Senior Minister Mr Goh Chok Tong at Marine Parade National Day dinner on 19 August 2006 brought public attention to the issue of falling birth rate again. The Prime Minister followed up on this issue in his National Day Rally speech.

The government’s position is:

“To sustain growth and vitality in our economy, we need a growing population in Singapore with talents in every field.”

The objective is a sustainable economy and the means is a growing population with talents. While the speech produced a very rational and balanced view on the topic, there are concerns on the social impact of such an idea of having more foreigners and immigrants in Singapore. How far will the government go in welcoming foreigners and immigrants to sustain the economy if Singaporeans do not produce enough babies?

Should Singaporeans be concerned if there are too many foreigners and immigrants in the society? Are we going to have a society where only one-third of its population are born and grown up in Singapore in the decades to come?

This declining birth rate and need of global talents is not a new issue. Mr Goh Chok Tong had raised many of the same issue under the subject Reproducing Ourselves in his National Day Rally 2000 Speech. For readers who want to look into the demographic and statistical facts behind the issue, the paper “Twenty-Five Years of Below Replacement Fertility: Implications for Singapore” is a good reference.

Low total fertility rate (TFR) is a common by-product in developed countries. Several factors contribute to this problem:

Social Barrier
In a developed economy, there is a wider spectrum of education level and career scope. The less educated males and highly educated females tend to have more difficulty in finding suitable spouses.

Life Style Choice
A developed economy provides more life style options to the people. Some people will choose to remain single, get married at an older age or have fewer children.

Financial Consideration
A developed economy has higher cost of living. Parents who want to provide higher standard of living to the family need to dedicate more time and energy on career development and upgrading to secure a career and support the family. The price to pay is usually late marriage and fewer children.

Government’s financial incentive to raise birth rate addresses the concern of the last social group only. How far it will go in improving fertility rate depends on how big this social group is. It will have no effect on the first two social groups.

Seeing it from a different perspective

We can see this birth rate issue from an Optimal Resources Allocation and Returns point of view. Our time and energy are our resources. We deploy the resources on different activities to earn returns like job satisfaction, companionship, personal joy, family bonding, financial gain etc. It is a matter of Work-Life balance. We choose where the balancing point is and decide how much time and energy to spend on which area. In return, we receive different level of gain from Work area and Life area.

Statistics shows that the Total Fertility Rate for Chinese females was 1.65 in 1990, and 1.07 in 2004. The Total Fertility Rate for Indian females was 1.89 in 1990, and 1.30 in 2004. The Total Fertility Rate for Malay females was 2.69 in 1990, and 2.10 in 2004. While Chinese females Total Fertility Rate has dropped below 2.1 in the many years past, their Malay sisters were able to keep the Total Fertility Rate above 2.1. What can we learn from the Malays community as we look into our population issue?

The best return for our time and energy can’t be purely economic based or family based. From an Optimal Resources Allocation and Returns point of view, it should be a balanced and sustainable growth of both. Are we, as individuals and as a nation, allocated too much human resources toward current economic development at the expense of sustainable long-term family and nation building?

Limitation to importing foreigners

Singapore’s experience shows that it can import foreigners to raise the population size and sustain economic growth. But there is a limit in this approach. As a rule of thumb, the stronger and larger cultural group assimilates the smaller cultural group. Singapore already has a large proportion of foreigners in its small population. How many more foreigners can Singapore take in?

At this point, 74% of the population is Singaporeans. It is maintaining a critical mass to sustain its own culture and assimilate new immigrants. What is the minimal size of local population to sustain its long-term cultural existence? If that figure is 70%, for example, then importing foreigners as a solution to the population problem cannot last for long. If we continue to import foreigners and reduce the local population percentage below the critical size, the cultural assimilation outcome will become very unpredictable. It can turn out to be a very nice and colourful rainbow culture or it can turn out be a source of great social, economic conflict.

It is not necessary for new immigrants to assimilate into the local culture of their new home countries. Many countries have seen the effect of new immigrants congregating in certain neighbourhoods or districts. Eventually, the new immigrants replaced the locals in the neighbourhood or district and turned it into their own ethnic enclave. These countries can absorb such new immigrant enclaves because there is still a much larger local population surrounding the enclaves to assimilate the next generation of the new immigrants. Can we say the same for Singapore if 50% of the population is foreign born?

Long-term plans

At the launch of the public consultation phase of the Concept Plan 2001, Minister Mr Mah Bow Tan said:

“The Concept Plan takes a long-term perspective of about 40-50 years. The starting point for planners in their review is the size of the population. Planners will base the Concept Plan 2001 on a long-term population size of 5.5 million. This includes citizens, permanent residents as well as employment-pass and work-permit holders. Why 5.5 million? This is not a target figure, nor is it an optimal population size. It is a reasonable growth estimate from today’s population of 4.0 million, in order to sustain Singapore’s economic growth and provide a critical mass for developing a vibrant city.”

In light of the Prime Minister’s National Day Rally speech, there are some questions the government needs to answer:

1 What is the projected population distribution of citizens, permanent residents, employment-pass / work-permit holders in the decades to come?

2 What is the current and projected share of the economic share of citizens, permanent residents, employment-pass / work-permit holders in the decades to come?

3 Is there a ceiling for permanent residents, employment-pass / work-permit holders population size with respect to the total population?

*This article was first published on TOC one year ago. 

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References:

SPEECH BY MR GOH CHOK TONG,SENIOR MINISTER, AT MARINE PARADE NATIONAL DAY DINNER, 19 AUGUST 2006, 8.30 PM AT ROLAND RESTAURANT

The Population - National Day Rally 2006

PRIME MINISTER GOH CHOK TONG’S NATIONAL DAY RALLY 2000 SPEECH IN ENGLISH

Population Trends 2006

Wanted: Babies to save our legacy

SPEECH BY MR MAH BOW TAN, MINISTER FOR NATIONAL DEVELOPMENT, AT THE LAUNCH OF THE PUBLIC CONSULTATION PHASE OF THE CONCEPT PLAN 2001 ON SAT, 26 AUG 2000 AT THE URA CENTRE, 10.00 AM

Singapore’s Changing Structure and the Policy Implications for Financial Security, Employment, Living Arrangements and Health Care

Fertility and Population Policy: the Singapore Experience

Fertility and the Family: An Overview of Pro-natalist Population Policies in Singapore