Leong Mun Wai: Transforming social assistance with PSP’s empowerment approach

In an impassioned address during the Budget 2024 debate, Mr Leong Mun Wai of the Progress Singapore Party (PSP) delivered a thorough critique and a series of recommendations that challenge the government’s current approach to fiscal planning and social assistance.

Amidst the complexities of Singapore’s financial landscape, his speech illuminated the fundamental disagreements between PSP’s vision for Singapore and the governing strategies in place.

Government’s “Handout Approach”

Mr Leong’s criticism was particularly sharp against what he described as the government’s “handout approach” to social assistance. He argued that this method, characterized by an overwhelming array of around 60 support schemes, contributes to inefficiency and confusion among beneficiaries.

He illustrated this by highlighting the case of a 65-year-old landscape worker, whose total income was bolstered by seven different government schemes to approximate a Minimum Living Wage.

Mr Leong pointed out that while the total income of such workers might align with the Minimum Living Wage proposed by the PSP, this income does not come solely from their employers. Instead, it is a combination of a base income of $17,400 and an additional $10,170 in government subsidies distributed across seven schemes: the Special Employment Credit, the Annual Progressive Wage Model Bonus, the Workfare Income Supplement, the Workfare Special Payment, CHAS subsidies, the Care and Support Package, and the U-Save and GST Vouchers.

Mr. Leong criticized the current system for its complexity and the psychological impact it has on lower-income workers. He argued that despite the financial assistance, the system’s reliance on a myriad of schemes could undermine workers’ self-esteem due to their relatively low base pay and the lack of significant incentives for self-improvement within these programs.

Furthermore, Mr Leong highlighted the administrative burden associated with accessing these benefits.

He detailed the involvement of multiple entities, including the Social Service Offices (SSO), the People’s Association, the Silver Generation Office, and various private charities, which complicates the process for needy Singaporeans. This not only escalates administrative costs but also hampers the efficient delivery of welfare benefits.

This example underscored the convoluted nature of the current system, where multiple schemes overlap to address singular socioeconomic challenges, complicating the social safety net and potentially diminishing the dignity of lower-income workers.

Administrative Inefficiency and Psychological Impact

Through his speech, Mr Leong Mun Wai called attention to the need for a more streamlined and effective approach to supporting Singapore’s lower-income workers, questioning the efficacy of the current system in meeting its intended socio-economic objectives

Further, Mr Leong critiqued the administrative inefficiency inherent in the handout system. The necessity for needy Singaporeans to navigate through a maze of eligibility rules, often with external assistance, signifies a critical flaw in the delivery of welfare benefits.

This complexity, coupled with the requirement for applications in more than half of these schemes, places an undue burden on individuals who are already struggling. Mr Leong emphasized the detrimental psychological impact on lower-income workers, who might see their self-esteem eroded by the low basic pay and the confusing plethora of short-term handouts.

The PSP’s Vision for Empowerment

Mr Leong says that the PAP government of today is relying on a patchwork scheme of vouchers, rebates, and top-ups that lower-income Singaporeans are increasingly dependent on, instead of pursuing systemic economic reforms such as reducing rent-seeking in the property market, strengthening labour protections, or introducing a Minimum Living Wage.

“Is this system dragging Singaporeans into a social trap rather than providing a social trampoline that allows Singaporeans to bounce back?” asks Mr Leong.

Offering a stark contrast to the criticized handout approach, Mr Leong advocated for a paradigm shift towards what he termed an “empowerment system.”

This system would streamline the government’s numerous schemes into a few, comprehensive, permanent programs designed to be easily understandable and accessible. The PSP’s vision focuses on providing a minimum level of support to every Singaporean, coupled with clear incentives for personal and professional development.

Key Proposals

Affordable Homes Scheme (AHS): At the heart of PSP’s proposals is the Affordable Homes Scheme, aimed at deferring land costs from the pricing of HDB flats to alleviate cost-of-living pressures and improve retirement adequacy. This scheme represents a foundational shift towards ensuring housing affordability and financial security for future generations of Singaporeans.

Minimum Living Wage: Mr Leong reiterated PSP’s call for a Minimum Living Wage of S$2,200 per month, arguing that it would provide a dignified base for every working Singaporean. Unlike the fluctuating and uncertain nature of the current handout approach, this proposal aims for a permanent, co-funded model to uplift the lowest earners in society.

National Health Insurance Scheme: To address the complexities and inadequacies of the current healthcare financing model, PSP proposed a National Health Insurance Scheme, funded by the government, to replace the current system of MediShield and CareShield premiums. This approach aims to reduce the financial burden on individuals while promoting healthier lifestyles and better retirement planning through incentivized health bonuses.

In his conclusion, Mr Leong emphasized the need for a transition from a reactive, handout-based model to a proactive, empowerment-focused approach. He argued that such a shift would not only simplify and make social assistance more effective but also reduce the fiscal burden on the government by consolidating resources currently scattered across multiple schemes.

“PSP estimated that the shift to the permanent scheme approach will not consume significantly more fiscal resources because the Government already has more than 60 schemes in place and has locked away tens of billions of dollars in endowment and trust funds,” said Mr Leong and ended by saying that Singapore can do a lot more to improve the well-being of our citizens, work to combat future challenges such as climate change, and provide support to worthy humanitarian causes abroad.