Future considerations

CHALLENGING and grim as the current global environment is, we have yet to see the worse. It is important to stay forward- looking and continue with Singapore's unfinished tasks. Like the 2009 Budget statement, future budget statements must take an integrated and targeted approach to strengthen our overall growth in a balanced manner. Three considerations need to be borne in mind:

Consideration 1: As we continue to expand our services sector, we must analyse the repercussions and implications of the current recession. We should rethink the longer-term impact of restructuring our manufacturing sector, especially the electronics segment. We must buy time to ensure the manufacturing sector is retained as long as possible, while allowing the services sector to develop further, including the financial sector, logistics, telecommunication, tourism, education and health care. We may have to ultimately prepare for the day, just as most mature economies have, when services become the dominant sector in Singapore.

The Government will have to continue incurring large expenditure on both soft services infrastructure - including in education, health care and information technology - as well as on hard infrastructure facilities such as public transportation networks and environmental preservation, so that Singapore can remain competitive as a cosmopolitan city state.

Consideration 2: The Government must continue to look into the plight of senior workers and housewives who are in their mid-40s or older, who possess only secondary school education. Social infrastructure must be made available to enhance their labour force participation rate. Double-income households may be inevitable. As these categories of Singaporeans could very well stay in the labour market for a further 20 years, they should build up their retirement nest eggs now, especially given the lengthening average national lifespan.

We must recognise that these groups of Singaporeans would not be in the position to compete with the large, regional pool of unskilled labour, who would readily accept lower wages. Fortunately, given decades of pro-business policies, the size of our economic cake has expanded significantly, and the economy has been able to provide more white- and blue-collar jobs than the resident working population can fill. I am, therefore, confident that the Government can cope with this mediumterm challenge, especially since it has massively increased expenditure on continuing education.

Having experimented with the pilot Workfare Income Supplement Scheme, we must now be prepared to expand it for as long as it is needed. We need to top up the wages of Singaporeans who accept jobs with monthly salaries of under $1,500, as a mean of addressing widening income disparities as Singapore's economy continues to globalise.

As new cohorts of Singaporeans enter job markets, they would be in better competitive positions, with at least a polytechnic or technical diploma. Skill development subsidies should continue to be available to prepare Singaporeans who are ready to take new jobs or make career switches. Life-long learning will become the way of life for modern workers.