Income gap issue needs 'real solutions'

Income gap issue needs 'real solutions'

SINGAPORE - Income inequality has become the fashionable thing to talk about at cocktails, in articles and even books. But the the way to deal with the growing gap between rich and poor is through real and concrete solutions, Prime Minister Lee Hsien Loong said yesterday.

Among them are equipping people with skills that are in demand in the economy, and redistributing wealth so that everyone has what former prime minister Lee Kuan Yew called "chips to play with".

These are among the measures that individual governments can take, PM Lee said, adding: "The income inequality will be there, but in absolute terms, we can improve lives for nearly everybody in the society, provided they work and are prepared to make the effort."

He made these remarks in a dialogue at The Singapore Summit, where he was asked questions ranging from Singapore's growth model and the Trans-Pacific Partnership, to Scotland's quest for independence.

The annual conference, organised by government agencies, brings together chief executives and financial leaders. Themes this year included sustainable growth, Asia's economic integration and the global energy market.

On inequality, he was asked how Asian governments can arrest the trend caused by rapid growth.

To this, he said inequality was not the result of rapid growth. There was inequality in Europe, the United States and Japan, where growth has slowed.

Rather, globalisation and technological advancements were what contributed to the trend.

Workers now had to compete with hundreds of millions of lower-paid workers joining the global economy from China and India. And technology has seen jobs automated - with robots and computers taking over tasks of skilled workers.

Acknowledging that income inequality caused social tensions and unhappiness, and that solutions were needed, he cautioned against "theoretical solutions", such as having a global wealth or income tax.

What governments can do is to help people get skills that are in demand - not just for those with a university education, but those who are technically inclined.

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