SINGAPORE - A day after the Prime Minister laid out a new way forward for Singapore, economists and politicians praised the shift for being a bold and necessary move in rebalancing the relationship between the State and the Singaporean.
But while Mr Lee Hsien Loong's National Day Rally (NDR) speech hit the right notes, the specific policy changes he announced drew a mixed reaction.
Some felt they were incremental rather than radical. Others said they were sparse on the numbers and details, leaving them guessing how much of an impact the changes would make and who would foot the bill of say, the new MediShield Life health insurance scheme.
Still, the changes show that the Government recognises the need to adapt its policies to a changing context for Singapore, said senior fellow and economist Donald Low of the Lee Kuan Yew School of Public Policy.
"We have recalibrated the balance between the State, the market and the individual. The orientation is correct now," he said.
"We were in danger of ideologising the earlier social compact and its emphasis on meritocracy, individual effort and the fear of moral hazard," he added.
"But the latest changes are a step in the right direction."
In his Rally speech, Mr Lee unveiled broad changes that would expand health-care coverage, increase housing grants to middle- income families, and make education more open and broad.
Several economists said the moves are an advancement of the shift to strengthen the social safety net that began in 2007. That was when the Government introduced the Workfare Income Supplement scheme for low-income workers who stay employed. Gradually, the scheme was expanded.
At the Rally, Mr Lee said the changes were prompted by global forces, Singapore's ageing society and growing inequality leading to social stratification. This has caused anxiety and uncertainty among many Singaporeans, and with the country at a turning point, a new approach to policies was required, the PM added.
Speaker of Parliament Halimah Yacob saw the new path as a "clear shift" with tangible changes to some longstanding policies.
"Although the Government is loath to cloak its policies in ideological terms... I can't help feeling that socialists would have said that some of the thinking behind these changes are quite aligned to theirs," she said. Socialists favour greater redistribution of wealth.
Former Nominated MP Siew Kum Hong felt most of the changes build on past and existing policies, but "this NDR marks a tipping point of sorts, at least in terms of public perception".
Some Singaporeans, however, are worried about the price tag of the new MediShield Life, a universal, compulsory national health insurance scheme for life.
Mr Lee has indicated taxes will rise or cuts will be made in other spending areas over time as "all good things have to be paid for".
Economists said it was difficult to estimate the extra costs, especially in the face of an ageing population, rising health-care costs and increasing longevity. The Government can afford it for the first few years, said Bank of America Merrill Lynch economist Chua Hak Bin, but "tax rates may have to increase at some point".
DBS economist Irvin Seah suggested the Government could take more contributions from current returns on the reserves invested when the need arises, but it would leave less for investment later.
"The fact that we are starting to plan early means we can garner the financial resources to make the plans materialise," he said.
Mr Low added: "The costs at this point are not very significant... But this is not the final set of concessions. This is the start of more to come."
Get a copy of The Straits Times or go to straitstimes.com for more stories.